Generation Income Properties Reports Material Agreements & Equity Sales

Ticker: GIPRW · Form: 8-K · Filed: Aug 29, 2024 · CIK: 1651721

Generation Income Properties, Inc. 8-K Filing Summary
FieldDetail
CompanyGeneration Income Properties, Inc. (GIPRW)
Form Type8-K
Filed DateAug 29, 2024
Risk Levelmedium
Pages12
Reading Time14 min
Key Dollar Amounts$0.01, $5.5 m, $3,080,000, $2,495,000, $405,470
Sentimentneutral

Sentiment: neutral

Topics: material-agreement, acquisition-disposition, financial-obligation, equity-sale

Related Tickers: GIPR

TL;DR

GIPR filed an 8-K detailing asset deals, new debt, and equity sales on 8/23.

AI Summary

On August 23, 2024, Generation Income Properties, Inc. entered into a material definitive agreement related to the completion of an acquisition or disposition of assets. The company also reported the creation of a direct financial obligation and unregistered sales of equity securities. Additionally, there were changes in directors and officers, including compensatory arrangements.

Why It Matters

This filing indicates significant corporate actions including asset transactions, new financial obligations, and equity issuance, which could impact the company's financial structure and shareholder value.

Risk Assessment

Risk Level: medium — The filing involves material definitive agreements, financial obligations, and unregistered equity sales, suggesting potential financial and operational shifts.

Key Players & Entities

  • GENERATION INCOME PROPERTIES, INC. (company) — Filer
  • August 23, 2024 (date) — Date of earliest event reported

FAQ

What specific material definitive agreement was entered into by Generation Income Properties, Inc. on August 23, 2024?

The filing indicates the entry into a material definitive agreement, but the specific details of the agreement are not provided in this summary section.

What type of asset acquisition or disposition was completed by the company?

The filing states the completion of an acquisition or disposition of assets, but the nature and details of these transactions are not specified in this section.

What is the nature of the direct financial obligation created by Generation Income Properties, Inc.?

The filing reports the creation of a direct financial obligation, but the specifics of this obligation are not detailed in the provided text.

Were there any unregistered sales of equity securities by the company?

Yes, the filing explicitly mentions 'Unregistered Sales of Equity Securities' as an item of disclosure.

What changes occurred regarding the company's directors or officers?

The filing notes 'Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers: Compensatory Arrangements of Certain Officers,' indicating personnel changes and related compensation.

Filing Stats: 3,594 words · 14 min read · ~12 pages · Grade level 12.7 · Accepted 2024-08-29 16:13:51

Key Financial Figures

  • $0.01 — ch registered Common Stock, par value $0.01 per share GIPR The Nasdaq Stock Mar
  • $5.5 m — ), at a purchase price of approximately $5.5 million, excluding transaction costs (as
  • $3,080,000 — equity of the Iowa SPE of approximately $3,080,000 purchased by JCWC Funding, LLC, a third
  • $2,495,000 — ty investor ("JCWC"), and approximately $2,495,000 of debt financing from Valley National
  • $405,470 — ail Ames, Iowa 3/31/2030 30,465 $405,470 Two, five-year renewal option remaini
  • $452,372 — (1) Annualized base rent escalates to $452,372 commencing on April 1, 2025. In conne
  • $3.08 million — GIPIA Operating Agreement, JCWC made a $3.08 million capital contribution to GIPLP in exchan
  • $2.495 million — a loan to the Iowa SPE in the amount of $2.495 million (the "Valley Loan") to finance the acqu
  • $16,641 — rincipal in the amount of approximately $16,641 are due and payable monthly thereafter,
  • $5.2 million — 17, in the original principal amount of $5.2 million. The Loan Modification Agreement exte
  • $32,268.70 — rincipal in the amount of approximately $32,268.70 are 2 due and payable monthly there
  • $200,000 — ll continue to receive a base salary of $200,000 per year, provided that the annual base
  • $300,000 — annual base salary will increase to (i) $300,000 upon the Company and its subsidiaries a
  • $115 million — Company and its subsidiaries achieving $115 million or greater in gross asset value of real
  • $400,000 — value of real estate assets owned, (ii) $400,000 upon the Company and its subsidiaries a

Filing Documents

01. Entry into Material Definitive Agreement

Item 1.01. Entry into Material Definitive Agreement. The information set forth under Items 2.01 and 2.03 below is hereby incorporated herein by reference.

01. Completion of Acquisition or Disposition of Assets

Item 2.01. Completion of Acquisition or Disposition of Assets. On August 23, 2024, Generation Income Properties, L.P., the operating partnership (the "Operating Partnership") of Generation Income Properties, Inc. (the "Company"), completed the acquisition of a 30,465 square-foot, single-tenant retail property in Ames, Iowa (the "Ames Property"). The acquisition was made by GIPIA 1220 S Duff Avenue, LLC, a Delaware limited liability company and single-purpose subsidiary of the Operating Partnership that was formed for the purpose of effecting the acquisition (the "Iowa SPE"). The Operating Partnership, through the Iowa SPE, purchased the Property pursuant to a Purchase and Sale Agreement, dated June 13, 2024, between the Operating Partnership and Duff Daniels, LLC, an Iowa limited liability company, Westbrook Daniels, LLC, an Iowa limited liability company, and Westbrook Wolf, LLC, an Iowa limited liability company (collectively, the "Seller"), at a purchase price of approximately $5.5 million, excluding transaction costs (as amended, the "Ames Purchase and Sale Agreement"). Pursuant to an Assignment and Assumption of Purchase and Sale Agreement, effective as of August 23, 2024 (the "Ames Assignment Agreement"), the Operating Partnership assigned, and the Iowa SPE assumed, all of the Operating Partnership's right, title and interest in and under the Ames Purchase and Sale Agreement, giving the Iowa SPE the right to acquire the Ames Property pursuant to the Ames Purchase and Sale Agreement. The Seller is not an affiliate of the Company or the Operating Partnership. The purchase price of the Ames Property and related transaction costs were funded using preferred equity of the Iowa SPE of approximately $3,080,000 purchased by JCWC Funding, LLC, a third-party investor ("JCWC"), and approximately $2,495,000 of debt financing from Valley National Bank ("Valley"), as discussed below. The Ames Property is 100% leased to Best Buy Stores, L.P., a Virginia limited partnersh

02. Unregistered Sales of Equity Securities

Item 3.02. Unregistered Sales of Equity Securities. The issuance of the Preferred Interests by the Iowa SPE to JCWC was made in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended (the "Securities Act"). The offer and sale of the Preferred Interests did not and does not involve a "public offering" as defined in Section 4(a)(2) of the Securities Act, was made without any form of general solicitation to a sophisticated party, and was made with full access to any information requested regarding the Iowa SPE. Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers Second Amended and Restated Employment Agreement with David Sobelman On August 26, 2024, the Company entered into a Second Amended and Restated Employment Agreement (the "Amended Employment Agreement") with David Sobelman, the Company's President and Chief Executive Officer. The Amended Employment Agreement, which was approved by the Company's Board of Directors on August 26, 2024 (the "Board"), amends and restates in its entirety the First Amended and Restated Employment Agreement, dated June 23, 2022, previously entered into between the Company and Mr. Sobelman. The Amended Employment Agreement provides that Mr. Sobelman will continue to receive a base salary of $200,000 per year, provided that the annual base salary will increase to (i) $300,000 upon the Company and its subsidiaries achieving $115 million or greater in gross asset value of real estate assets owned, (ii) $400,000 upon the Company and its subsidiaries achieving $150 million or greater in gross asset value of real estate assets owned, and (iii) $600,000 upon the Company and its subsidiaries achieving $500 million or greater in gross asset value of real estate assets owned. The base salary may be increased, but not decreased, in the discretion of the Board. The Amended Emplo

01. Regulation FD Disclosure

Item 7.01. Regulation FD Disclosure. The Company issued a press release on August 29, 2024, announcing the completion of the acquisition of the Ames Property. A copy of such press release is attached hereto as Exhibit 99.1 and incorporated herein by reference. The information in this Item 7.01 and the related information in Exhibit 99.1 attached hereto shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act") or otherwise subject to the liabilities of that section and shall not be deemed incorporated by reference in any filing made by the Company under the Securities Act of 1933, as amended or the Exchange Act except as set forth by specific reference in such filing.

01 Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits (a)

Financial Statements of Businesses Acquired

Financial Statements of Businesses Acquired. The Company intends to file the financial statements required by Item 9.01(a), in accordance with Rule 3-14 of Regulation S-X, by amendment to this Current Report on Form 8-K no later than 71 calendar days following the date that this Current Report on Form 8-K is required to be filed. (b) Pro Forma Financial Information. 4 To the extent required by this item, pro forma financial information relating to the acquisition described in Item 2.02 of this Current Report on Form 8-K will be filed in an amendment to this current report on Form 8-K not later than 71 days after the date on which this initial Current Report on Form 8-K is required to be filed. ( d) Exhibits . Exhibit No. Description 10.1 Second Amended and Restated Employment Agreement, dated August 26, 2024, between Generation Income Properties, Inc. and David Sobelman. 10.2 Ames Purchase and Sale Agreement dated June 13, 2024. 10.3 Ames Assignment Agreement dated August 23, 2024 10.4 Assignment and Assumption of Ames Lease 10.5 Loan Agreement dated August 23, 2024, between GIPIA 1220 S Duff Avenue, LLC and Valley National Bank 10.6 Promissory Note dated August 23, 2024, between GIPIA 1220 S Duff Avenue, LLC and Valley National Bank 10.7 Amended and Restated Limited Liability Company Agreement for GIPIA S Duff Avenue, LLC dated August 23, 2024. 10.8 Third Allonge to Promissory Note for GIPVA 130 Corporate Blvd, LLC dated August 23, 2024 10.9 Second Note and Loan Modification Agreement for GIPVA 130 Corporate Blvd, LLC dated August 23, 2024 99.1 Press Release, dated August 29, 2024 104 Cover Page Interactive Data File (embedded within the Inline XBRL document)

Forward-Looking Statements

Forward-Looking Statements This Current Report on Form 8-K may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainty. Words such as "anticipate," "estimate," "expect," "intend," "plan," and "project" and other similar words and expressions are intended to signify forward-looking statements. Forward-looking statements are not guarantees of future results and conditions but rather are subject to various risks and uncertainties. Such statements are based on management's current expectations and are subject to a number of risks and uncertainties, many of which are beyond management's control, that could cause actual results to differ materially from those described in the forward-looking statements, as well as risks relating to general economic conditions, market conditions, interest rates, and other factors. Investors are cautioned that there can be no assurance actual results or business conditions will not differ materially from those projected or suggested in such forward-looking statements as a result of various factors. Please refer to the risks detailed from time to time in the reports we file with the SEC, including the Company's Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC, as well as other filings on Form 10-Q and periodic filings on Form 8-K, for additional factors that could cause actual results to differ materially from those stated or implied by such forward-looking statements. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless required by law. 5

SIGNATURES

SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. GENERATION INCOME PROPERTIES, INC. Date: August 29, 2024 By: /s/ David Sobelman David Sobelman Chief Executive Officer 6

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